5,000 new redundancy claims made every month

PUBLIC ACCOUNTS COMMITTEE: THERE ARE currently 5,000 new redundancy claims every month, the Dáil Public Accounts Committee (PAC) heard yesterday.

The secretary general of the Department of Enterprise, Trade and Employment, Seán Gorman, revealed staff had been redeployed to cope with the increased workload in the area of redundancy payments.

“This year the level of redundancies is obviously running very high, 5,000 claims per month. There’s no doubt the level of debt is going to increase and increase quite significantly,” he said.

Mr Gorman said there had been 40,607 redundancies in 2008, representing a rise of 59 per cent on the total figure for the previous year.

Twelve extra staff have been brought in to help with redundancy payments. Mr Gorman said they were not new employees but had been reallocated from the work permits area, which “unfortunately” was not as busy as it had been.

Mr Gorman said the workload of the recoveries unit had also grown as the level of new debt had increased in proportion to the number of redundancies.

“This is borne out by the fact that, in spite of the write-offs at the end of 2008 and almost €1 million being achieved in debt recovery, the accumulated redundancy debt has risen to approximately €48 million.”

However, he said he was confident the department was in a stronger position to pursue the debt than it had been for some time. He said a total of €176.75 million was paid out by the State in redundancy payments in 2008. Of this, €14.12 million was paid directly to former employees whose companies may have gone into liquidation.

Mr Gorman said a “write-off” committee was set-up in April 2008 to identify and write off debts considered irrecoverable.

By the end of last year the committee had identified historic debt to the value of €8.5 million relating to redundancy and insolvency payments which it deemed irrecoverable. This has now been written off in the social insurance funds accounts.

Meanwhile, committee members asked Mr Gorman about the recent scandal involving Fás, the national training and employment agency. PAC chairman Bernard Allen (FG) referred to an anonymous letter containing allegations about Fás that prompted the internal audit. The letter was sent to the then minister for enterprise, trade and employment Mary Harney in October 2004.

“I just don’t understand how Fás was left to operate from 2004 until the present time without the department going in and going through the organisation root and branch,” Mr Allen said.

Labour TD Tommy Broughan asked: “Why didn’t the alarm bells ring?”

Mr Gorman said the matter was being dealt with through an “internal process”, and it took a long time for it to come back out of the system. He said he would never have felt from seeing media coverage of events such as the agency’s Science Challenge programme in the US, “that there was something excessive going on”.